Question

The stockholders’ equity section of the balance sheet for Stinson Company at December 31,
2016, is as follows:

Required
a. What is the par value per share of the preferred stock?
b. What is the dividend per share on the preferred stock?
c. What is the number of common stock shares outstanding?
d. What was the average issue price per share of the common stock?
e. Explain the difference between the average issue price and the market price of the common stock.
f. If Stinson declared a 2-for-1 stock split on the common stock, how many shares would be outstanding after the split? What amount would be transferred from the retained earnings account because of the stock split? Theoretically, what would be the market price of the common stock immediately after the stock split?